Pradhan Mantri Vaya Vandana Yojana (PMVVY) is the latest among the various new schemes for the senior citizens of India. Finance Minister Arun Jaitley on 21st July, 2017 officially introduced the new pension scheme (PMVVY) for citizens of the age 60 years and above. The scheme opened on 4th May, 2017 and has so far received a good response. And it will be open for subscription till 3rd May, 2018.
Under this scheme, there will be a fixed rate of return of 8% per annum (payable every month) for 10 years and any fluctuation in rates over time will not affect the senior citizens who invest in this scheme. Another great feature of the scheme is that it is exempted from GST. This scheme has been structured keeping in mind the need of senior citizens for a non-fluctuating, secure and reasonable return on their investment. At the end of the policy term of 10 years, the subscriber shall receive the purchase price and final/ last installment. However, if the subscriber dies during these 10 years, the amount shall be paid to the beneficiary.
The scheme can be subscribed online as well as manually through Life Insurance Corporation. The privilege has been solely given to LIC due to its high settlement ratio (near to maximum). As per the LIC, the scheme had already got 58,152 subscribers with a total collection of Rs 2,705.04 crores premium.
All You Need to Know About PMVVY:
1) The scheme will remain open for subscription till 3rd May 2018.
2) Subscription can be done online at https://eterm.licindia.in/Jaonline/pages/fpagevarishta.jsp as well as offline through LIC only.
3) The assured rate of return is 8% per annum for 10 years payable monthly/ quarterly/ half yearly/ yearly (as opted by subscriber), at the end of each period.
4) The scheme specifies a minimum and maximum limit for investment according to the pension payment mode chosen by the subscriber. See the table given below –
5) The base rate of return remains 8% however it also slightly differs with the mode of payment chosen as given below –
6) On completion of the term of 10 years, the subscriber will get the purchase price and final/ last installment.
7) In case of death of the subscriber during these 10 years, the amount shall be paid to his/her beneficiary.
8) In case of subscriber's exit prematurely for the treatment of any terminal /critical illness of self or spouse, he will be refunded 98% of the subscription amount.
9) Also, after the completion of 3 policy years, the subscriber can take a loan up to 75% of the amount of subscription so as to meet his liquidity needs. Interest will be deducted/ adjusted from installments and the principal from claim proceeds.
10) The scheme is exempted from GST.
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